Japan on Monday asked India to sign the Nuclear Non-Proliferation Treaty (NPT) even as the two sides decided to reopen talks on a bilateral civil nuclear agreement.

During the sixth Foreign Minister-level strategic dialogue here, the two sides agreed to prepare a master plan for the industrial development of south India, especially areas around Chennai and Bangalore, and accelerate talks on export of rare earths to Japan.

Another decision was to extend their dialogue to a code of conduct in outer space, cyber security and maritime issues, including security and freedom of navigation in the South China Sea. The talks also covered Japanese investment in high speed trains, the Delhi-Mumbai Industrial Corridor and the Dedicated Freight Corridor. While agreeing to step up interaction between the Coast Guards, India and Japan decided to hold their first-ever maritime exercises towards the middle of the year.

New Delhi and Tokyo agreed to resume their dialogue on a civil nuclear agreement but the initial reaction from the principal interlocutors — Foreign Ministers S.M. Krishna and Koichiro Gemba — suggested that both sides were sticking to their earlier positions — India insisting that its non-proliferation behaviour was impeccable enough to warrant the inking of the pact and Japan wanting India to comply with its promise of a ban on further nuclear testing made in the run-up to a clearance by the Nuclear Suppliers Group (NSG).

A joint statement, after the Fifth Energy dialogue held earlier in the day, indicated that despite the sentiments expressed by the Foreign Ministers, both sides were maintaining positions that were some distance from being reconciled. The statement mentioned in detail prospects of cooperation and ongoing projects in all segments but civil nuclear agreement.

“Japan is asking India to join the NPT… the Foreign Ministers instructed the negotiators to hold talks … Japan views India as a partner with which it should pursue civil nuclear agreement, there is no doubt [about] it,” said Japanese sources after the official round of talks and a courtesy call by Mr. Gemba on Prime Minister Manmohan Singh.

“We have instructed our negotiators on the way forward,” Mr. Krishna said and added the two countries understood the “concerns” of each other which were related to their historic experiences. Officials explained this to mean that while India says its clean non-proliferation record was good enough to restart civil nuclear talks, Japan feels that since India is not a signatory to the NPT, it should demonstrate its commitment to a ban on testing in words.

On maritime dialogue, Mr. Gemba said, “India is actually situated at an important place on the sea lanes of the communication which links Japan with the Middle East. So, I cannot overlook the geo-political significance of the location of India.”

Japanese companies have a virtual monopoly on supplying reactor vessels, a critical component of civil nuclear plants. Officials in the past said that without an India-Japan civil nuclear agreement, Japanese origin firms might not be able to supply components to French and American companies which had won orders to instal nuclear plants in India.

On the trade front, India has extended the validity of an earlier agreement to supply two million tonnes of iron ore per year. It will thus retain its foothold in the Japanese market despite supply disruptions due to court rulings and higher taxes. There is also domestic unease over exporting primary commodities that has led to India slipping from its position as the world's top iron exporter to the third place.

Ahead of the strategic dialogue, the External Affairs Ministry had said the two sides would review all aspects of the bilateral strategic and global partnership and discuss regional and international issues of mutual interest.

The talks were sandwiched between high-level consultations with the U.S. — a summit-level Japan-U.S. meeting took place last month and India and the U.S. will hold their Foreign Minister-level strategic dialogue next week.

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